MoF notifies amendments to National Savings Time Deposit Scheme and Kisan Vikas Patra Scheme with retrospective effect [Read Notification]

MoF - amendments - Kisan - Vikas - Patra - Scheme - TAXSCAN

The Department of Economic Affairs at the Ministry of FInance has recently notified the amendments made to the National Savings Time Deposit Scheme and Kisan Vikas Patra Scheme.

“The maturity period of an account opened on or after the 1st day of January, 2023 shall be ten years and the deposits made in the account shall double on maturity”, the amendment to the Kisan Vikas Patra Scheme, 2019 stated.

Table 4, showing showing the premature closure value of account opened on or after 1st day of January, 2023 with 1000 rupees, was also inserted in the act : –

Period from the date of the certificate to the date of its encashmentAmount payable inclusive of interest (in Rupees)
Two and half years but less than three years1162
Three years but less than three and half years1198
Three and half years but less than four years1234
Four years but less than four and half years1272
Four and half years but less than five years1311
Five years but less than five and half years1351
Five and half years but less than six years1392
Six years but less than six and half years1435
 Six and half years but less than seven years1478
Seven years but less than seven and half years1524
Seven and half years but less than eight years1570
Eight years but less than eight and half years1618
Eight and half years but less than nine years1667
Nine years but less than nine and half years1771
 Nine and half years but before Maturity of Certificate1771
On maturity of certificate2000

Even though the amendment was affected retrospectively, deemed to have come into force on the 1st day of January, 2023, the Explanatory Memorandum said the following, “The Kisan Vikas Patra (Amendment) Scheme, 2023 takes effect from the date as specified in the notification. However, no one shall be adversely affected as a result of retrospective effect being given to this amendment Scheme.”

The amends to the National Savings Time Deposit Scheme, 2019, also deemed to have come into force on the 1st day of January, 2023, notified the changes to the the rate of interest as specified below shall be applicable to the deposit made on or after 1st day of January, 2023 under the Scheme.

One Year Deposit accounts – 6.6 % p.a.

Two – Years – 6.8 % p.a.

Three – Years – 6.9 % p.a.

Five Years –  7 % p.a.

In regard to the retrospective application, it was also clarified that, “The National Savings Time Deposit (Amendment) Scheme, 2023 takes effect from the date as specified in the notification. However, no one shall be adversely affected as a result of retrospective effect being given to this amendment Scheme.”

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